Correlation Between Haverty Furniture and Coty
Can any of the company-specific risk be diversified away by investing in both Haverty Furniture and Coty at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Haverty Furniture and Coty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haverty Furniture Companies and Coty Inc, you can compare the effects of market volatilities on Haverty Furniture and Coty and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Haverty Furniture with a short position of Coty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haverty Furniture and Coty.
Diversification Opportunities for Haverty Furniture and Coty
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haverty and Coty is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Haverty Furniture Companies and Coty Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coty Inc and Haverty Furniture is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Haverty Furniture Companies are associated (or correlated) with Coty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coty Inc has no effect on the direction of Haverty Furniture i.e., Haverty Furniture and Coty go up and down completely randomly.
Pair Corralation between Haverty Furniture and Coty
Considering the 90-day investment horizon Haverty Furniture Companies is expected to under-perform the Coty. In addition to that, Haverty Furniture is 1.11 times more volatile than Coty Inc. It trades about -0.24 of its total potential returns per unit of risk. Coty Inc is currently generating about -0.17 per unit of volatility. If you would invest 753.00 in Coty Inc on September 26, 2024 and sell it today you would lose (46.00) from holding Coty Inc or give up 6.11% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Haverty Furniture Companies vs. Coty Inc
Performance |
Timeline |
Haverty Furniture |
Coty Inc |
Haverty Furniture and Coty Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Haverty Furniture and Coty
The main advantage of trading using opposite Haverty Furniture and Coty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haverty Furniture position performs unexpectedly, Coty can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Coty will offset losses from the drop in Coty's long position.Haverty Furniture vs. Floor Decor Holdings | Haverty Furniture vs. Live Ventures | Haverty Furniture vs. Home Depot | Haverty Furniture vs. Lowes Companies |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Transaction History View history of all your transactions and understand their impact on performance |